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16 February 2022

The government’s focus on lifelong learning must go further

Investment in skills is key to post-pandemic growth.

By Daisy Hooper

In September 2020, Boris Johnson set out his vision for the Lifetime Skills Guarantee: to give all adults the ability to access skills training throughout their lives. This was in direct response to the events of the earliest months of the pandemic, which proved pivotal in changing the world of work.

Traditional ways of working were upended, whole sectors were forced to close, and many workers began to re-evaluate whether their job was something they wanted to, or were able to, continue with.

Adult retraining is so important because skills training holds the key to solving one of the most persistent challenges to the UK economy: the productivity puzzle. The UK has had a decades-long productivity problem, characterised by a “long tail” of less-productive businesses, many of which are SMEs. This is in part due to a lack of investment in higher-level skills and a policy environment that fails to encourage private investment in training.

In the post-pandemic context, the need for retraining is stark. In order to prevent the scarring effects of Covid on workers’ employment prospects, it is imperative that workers get better access to training that provides the skills that employers need. However, the workers most in need of skills training are those least likely to seek it out.
This access to retraining is particularly important for workers trying to transition from declining industries to growth sectors such as tech and artificial intelligence (AI), as well as green industries that are crucial for the government’s ambitions to achieve net zero by 2050. To effectively transition between sectors, workers need both technical and transferable skills.

The importance of management apprenticeships

To date, the apprenticeships system has helped to plug part of the gap for the UK’s retraining needs. The ability to study without paying the training costs, while also gaining practical work experience and a salary, is an attractive prospect to many intending to gain new skills. The Apprenticeship Levy has forced businesses to assess their skills needs and to invest – and many employers have identified the same gap: management skills. This isn’t just a private sector issue; the government has recently acknowledged this skills gap in the public sector by way of the recently announced review into NHS management, as well as the drive to build a new civil service curriculum and campus.

Management skills cover a broad variety of skills essential for employability beyond those of merely managing a team or a project. These are transferable skills that help workers be productive at work, handle change and solve problems. In particular, recent Chartered Management Institute (CMI) research identified that the top skills critical to employability are team working, critical thinking and problem solving, and communication skills. Management apprenticeships teach all of these.

We also know that investing in management and leadership skills creates economic benefits for both individuals and organisations. In research conducted with forecasting firm Oxford Economics, the CMI found that managers who achieved Chartered Manager status boosted their organisations’ business revenues by £62,000 each year on average, and by £310,000 over five years. The research also estimated an additional contribution of £22,400 to the UK economy every year from each manager becoming Chartered. As the skills gained from management apprenticeships foster greater employability and have clear economic benefits, it is demonstrably clear that management apprenticeships are a worthwhile investment for the public and private sectors.

There are, however, suggestions from a few loud voices within the skills sector that Apprenticeship Levy funds are not being spent on those that need them the most. Exaggerated claims around levy funds being used to bolster executives’ CVs at the expense of younger workers are not borne out by the data, and should not be used as an argument to starve older workers of training provision. Department for Education data shows that in the 2019-20 academic year, 49 per cent of management apprentices were studying a Level 3 Team Leader apprenticeship – a qualification level that prepares the learner for their very first step on the management ladder, and a far cry from the C-suite.

If we want to see the whole workforce able to enjoy productive, satisfying careers, and the economy become more productive as a whole, we must move away from seeing skills provision and funding as a zero-sum game between the experienced and those at the beginning of their working lives. Instead, we need to offer the opportunity for people at all stages of their working lives to take a management apprenticeship, to boost their team-working and employability skills, and to become more productive.

Looking to the future of skills and retraining

As the UK economy moves beyond the pandemic, the government has rightly made skills and retraining a clear focus for its recovery activity – but now it needs to follow through on that commitment. One policy innovation, the National Skills Fund, was announced as a core part of Rishi Sunak’s March budget and was well-received within
the further education sector. The fund has the potential to provide a pipeline of skills training for workers, preparing them to take up future apprenticeship opportunities.

Looking forward, the introduction of the Lifelong Loan Entitlement (LLE) in 2025 has the potential to be a game-changer by providing access to loans for people to take further education courses throughout their lives. While we look forward to working with the government on the LLE’s design and delivery, we don’t yet know how or if this will affect apprenticeship funding. I would like to see the government ensure that both businesses and employees are clear about the benefits and differences between the Apprenticeship Levy and LLE funds before the entitlement begins so that they know which system will be most appropriate to meet their needs. Apprenticeships and the LLE need to work alongside each other, meaning we must fund both systems properly to achieve maximum impact.

The shock delivered by the pandemic underlined the need for action on adult skills. Together with other interventions, management apprenticeships are crucial to employability and business productivity. If it learns from the successes of the employer-led apprenticeship model, the government has the opportunity to deliver a truly bold answer to a perennial question, while at the same time transforming the prospects of thousands across the UK.

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